Which English company’s collapse formed the center of Britain’s South Sea Bubble crash of 1720?

The South Sea Company formed the center of Britain’s South Sea Bubble crash of 1720.

Founded in 1711, the company received a government-backed monopoly over trade with parts of Spanish South America, although its realistic trading opportunities were much more limited than many investors imagined. It also took on British government debt in exchange for shares.

Speculation drove the share price sharply upward in 1720. As confidence weakened, investors rushed to sell, and the price collapsed. The panic damaged investors, exposed corruption, and contributed to a broader financial crisis involving other speculative ventures.

The Mississippi Company in France experienced a related bubble during the same period, but it was a separate company and episode. The South Sea Bubble remains a classic example of how promotional narratives, easy credit, and herd behavior can inflate asset prices.